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Internal Market: Liechtenstein to be brought to court over undue controls of service providers

The EFTA Surveillance Authority decided today to refer Liechtenstein to the EFTA Court for breaching the Services Directive and the rules on the provision of cross-border services and establishment in the European internal market.

By indiscriminately requiring prior authorisation for the establishment of service providers and prior notification of cross-border service provision, Liechtenstein is imposing undue burdens and obstacles to the development of a harmonious internal market.

States are allowed to control the quality of services provided in their territory, but generally not prior to the establishment of a company in the country and in any event proportionate to the nature, risk and scale of the activity involved. In the view of the Authority, Liechtenstein also fails to adequately prevent the duplication of comparable requirements and controls imposed elsewhere on the same service provider.

The Services Directive requires States in the EEA to simplify procedures and formalities that service providers need to comply with. Unjustified and disproportionate burdens shall be removed, and the establishment of businesses and cross-border provision of services shall be facilitated.

The Authority has tried to convince Liechtenstein to modify its legislation on several occasions. However, in the light of the reactions from the Liechtenstein Government, the Authority has no other choice than referring the case to the EFTA Court for final resolution.